Self-Regulatory Organizations; The Depository Trust Company; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Establish a Special Segregation Account for a Participant or Pledgee That Is a Derivatives Clearing Organization or Futures Commission Merchant, 51444-51447 [2017-24049]

Download as PDF 51444 Federal Register / Vol. 82, No. 213 / Monday, November 6, 2017 / Notices POSTAL SERVICE Product Change—Priority Mail Express and Priority Mail Negotiated Service Agreement Postal ServiceTM. ACTION: Notice. AGENCY: The Postal Service gives notice of filing a request with the Postal Regulatory Commission to add a domestic shipping services contract to the list of Negotiated Service Agreements in the Mail Classification Schedule’s Competitive Products List. DATES: Date of notice required under 39 U.S.C. 3642(d)(1): November 6, 2017. FOR FURTHER INFORMATION CONTACT: Elizabeth A. Reed, 202–268–3179. SUPPLEMENTARY INFORMATION: The United States Postal Service® hereby gives notice that, pursuant to 39 U.S.C. 3642 and 3632(b)(3), on October 31, 2017, it filed with the Postal Regulatory Commission a USPS Request to Add Priority Mail Express & Priority Mail Contract 52 to Competitive Product List. Documents are available at www.prc.gov, Docket Nos. MC2018–18, CP2018–40. SUMMARY: Elizabeth A. Reed, Attorney, Corporate and Postal Business Law. of the Act 3 and Rule 19b–4(f)(6) thereunder.4 The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Clearing Agency’s Statement of the Terms of Substance of the Proposed Rule Change The proposal would add new Rule 37 (Segregated Accounts for Customer Property) to provide that a Participant 5 or Pledgee may establish a specifically designated Account to which Eligible Securities may be credited that the Participant or Pledgee wishes to segregate as the property of its customers that trade commodities, options, swaps, and other products (‘‘Customer Property’’) subject to the Customer Property Segregation Rules.6 Based on this segregation structure and the representations and warranties made by the Participant or Pledgee under the proposed Rule, DTC would, upon the request of the Participant or Pledgee, provide an acknowledgment of the segregation of such Customer Property,7 as further described below. II. Clearing Agency’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change [FR Doc. 2017–24039 Filed 11–3–17; 8:45 am] BILLING CODE 7710–12–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–81990; File No. SR–DTC– 2017–020] Self-Regulatory Organizations; The Depository Trust Company; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Establish a Special Segregation Account for a Participant or Pledgee That Is a Derivatives Clearing Organization or Futures Commission Merchant Pmangrum on DSK3GDR082PROD with NOTICES October 31, 2017. Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on October 20, 2017, The Depository Trust Company (‘‘DTC’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II and III below, which Items have been prepared by DTC. DTC filed the proposed rule change pursuant to section 19(b)(3)(A) 1 15 2 17 U.S.C. 78s(b)(1). CFR 240.19b–4. VerDate Sep<11>2014 14:48 Nov 03, 2017 Jkt 244001 In its filing with the Commission, DTC included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. DTC has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. 3 15 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). 5 Each capitalized term not otherwise defined herein has its respective meaning as set forth in the Rules, By-Laws and Organization Certificate of The Depository Trust Company (the ‘‘Rules’’), available at https://www.dtcc.com/legal/rules-andprocedures.aspx. 6 ‘‘Customer Property Segregation Rules’’ means the rules and regulations of the Commodity Futures Trading Commission (‘‘CFTC’’), relating to the deposit of customer property (including money, securities and other property) held by derivatives clearing organizations (‘‘DCOs’’) or futures commission merchants (‘‘FCMs’’) for customers that trade commodities, options, swaps and other products. 7 U.S.C. 6d; 17 CFR 1.20–1.30, 22, 30. Under the proposed rule change, only Deposited Securities credited to an appropriately designated Account may constitute ‘‘Customer Property’’ for purposes of such Customer Property Segregation Rules; DTC does not, and will not under the proposed rule change, segregate money. 7 See 7 U.S.C. 6d(a)(2); 7 U.S.C. 6d(f); 17 CFR 1.20(d); 1.20(g); 1.26; 22.5; 30.7. 4 17 PO 00000 Frm 00061 Fmt 4703 Sfmt 4703 (A) Clearing Agency’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The proposal would add new Rule 37 (Segregated Accounts for Customer Property) to provide that a Participant or Pledgee may establish a specifically designated Account to which Eligible Securities may be credited that the Participant or Pledgee wishes to segregate as Customer Property subject to the Customer Property Segregation Rules. Based on this segregation structure and the representations and warranties made by the Participant or Pledgee under the proposed Rule, DTC would, upon the request of the Participant or Pledgee, provide an acknowledgment of the segregation of such Customer Property, as further described below. A. Background a. DTC Omnibus Account Structure DTC maintains omnibus Accounts for its Participants and Pledgees.8 That is, it 8 DTC holds Eligible Securities collectively on behalf of Participants and reflects the transfer of interests in those Eligible Securities among Participants by computerized book-entry. Eligible Securities Deposited with DTC for book-entry transfer services are registered in the name of its nominee, Cede & Co. (‘‘Cede’’), a New York partnership. When the Eligible Securities are registered in the name of Cede, DTC acquires legal title to the Eligible Securities and, when DTC credits interests in these Eligible Securities to the Securities Accounts of Participants, those Participants acquire a beneficial interest in the Eligible Securities and a Security Entitlement with respect to those Eligible Securities is credited to their Accounts. A Security Entitlement is both a package of personal rights against the securities intermediary [in this case, DTC] and an interest in the property held by the securities intermediary. NYUCC § 8–102(14)(i); NYUCC § 8–102(17) and OFF. CMT. 17. A security entitlement is not, however, a specific property interest in any [security] held by the securities intermediary or by the clearing corporation through which the securities intermediary holds the [security]. NYUCC § 8–102(17) and OFF. CMT. 17. Thus, a Participant does not have a right to any particular security; each Participant has a proportionate interest in the fungible total inventory of the issue held by DTC. Participants, in many cases, are themselves securities intermediaries, maintaining securities accounts for the benefit of their customers, crediting a portion of the amount of any issue of a Security held in their Account(s) to one or more customers, as securities entitlements of their customers against them. That is, their customers are entitlement holders, holding the rights and property interest represented by the amount of the security credited to their account(s) vis a vis the Participant. Some customers of a Participant may also be securities intermediaries, holding on behalf of, and maintaining securities accounts for, their own customers, and so forth. DTC does not know whether a Participant is holding interest in the Securities for itself or on behalf of its customers, as their securities intermediary. This tiered system of intermediaries holding interests in securities for their respective customers is generally described as the ‘‘indirect holding E:\FR\FM\06NON1.SGM 06NON1 Federal Register / Vol. 82, No. 213 / Monday, November 6, 2017 / Notices Pmangrum on DSK3GDR082PROD with NOTICES does not distinguish among Accounts that Participants or Pledgees may use for activities that are proprietary or conducted by the Participant or Pledgee for the benefit of customer(s). The Rules expressly provide that ‘‘[a] Participant or Pledgee which utilizes the services of [DTC] for another Person shall, so far as the rights of [DTC], and other Participants and Pledgees are concerned, be liable as principal.’’ 9 The Rules provide for Segregated Accounts that Participants have typically used to separate Securities held for their customers. The characteristics of a Segregated Account are, chiefly, that DTC has no lien on or claim to the Securities credited thereto to secure any obligation of the Participant to DTC.10 Participants therefore use Segregated Accounts to separately identify customer property.11 The Rules also provide that Securities Pledged to a Pledgee (when credited to the Account of the Pledgee in a Free Pledge or, in a Pledge Versus Payment), are held free of any lien or other interest of DTC.12 Thus, the Pledge mechanism is a tool that may be used by a Pledgee to segregate Securities at DTC. If a Participant or Pledgee holds Segregated or Pledged Securities on behalf of customers, that would be reflected in the accounts maintained by the Participant or Pledgee for its customers. DTC has no knowledge of whether Securities credited in that manner are held by the Participant or system.’’ Id. Any entitlement holder may only assert its rights to a security entitlement against its own securities intermediary; Participants and Pledgees are in contractual privity with DTC; their customers are not and do not have any claim against DTC to the security entitlement of the Participant. Such customers of a Participant would have securities entitlements against the Participant that is acting on their behalf as their ‘‘securities intermediary.’’ Such customers only have rights against the Participant, and not against the Participant’s securities intermediary; i.e., DTC. See NYUCC § 8–503 OFF. CMT. 2. (‘‘The entitlement holder cannot assert rights directly against other persons, such as other intermediaries [DTC] through whom the intermediary [the Participants] holds the positions . . . .’’). Moreover, DTC does not owe any duties to such customers. See NYUCC § 8–115 OFF. CMT. 4. (‘‘[T]his section embodies one of the fundamental principles of the Article 8 indirect holding system rules—that a securities intermediary [DTC] owes duties only to its own entitlement holders [its Participants]’’). 9 Rule 2, section 2, supra note 5. 10 Rule 1, section 1, supra note 5. 11 Participants that are registered broker-dealers use Segregation Accounts as a tool to maintain compliance with their obligations under Rule 15c3–3 of the Act (‘‘Customer Protection Rule’’). 17 CFR 240.15c3–3. The Customer Protection Rule requires, among other things, that broker-dealers maintain control of all fully-paid or excess margin Securities they hold for the accounts of customers. Compliance with those obligations by such brokerdealers is external to DTC. See Rule 2, supra note 5. 12 Rule 4(A), supra note 5. VerDate Sep<11>2014 14:48 Nov 03, 2017 Jkt 244001 51445 Pledgee for customers. It is the sole responsibility of the Participant or Pledgee to maintain appropriate records on its own books to identify customer Securities separately. Segregation Rules prescribe the precise form of Acknowledgment Letter that is required for each the entity type (FCM and DCO) and the type of Customer Property.19 b. Customer Property Segregation Rules of the CFTC Because DTC is agnostic as to whether, when and how any Participant or Pledgee may be utilizing its Account for the benefit of customers, DTC cannot independently verify that any particular Securities are ‘‘customer securities’’ vis` a-vis the Participant or Pledgee. However, FCMs and DCOs have statutory requirements for the separate identification of Customer Property pursuant to the Customer Property Segregation Rules.13 To accommodate this need of certain Participants or Pledgees that are FCMs or DCOs, DTC proposes this rule change, pursuant to which DTC would provide acknowledgment of Customer Property credited to the specified Accounts, in reliance on the representations of the Participant or Pledgee provided in the proposed Rule.14 The Customer Property Segregation Rules require that each FCM and DCO separately account for, and segregate from its own proprietary funds, all money, securities, or other property deposited by futures customers 15 for trading on designated contract markets.16 The Customer Property Segregation Rules also provide that an FCM or DCO may only deposit futures customer property with a bank or trust company, and, additionally, an FCM may deposit with a DCO or another FCM (each, a ‘‘depository’’).17 FCMs and DCOs are required to obtain a written acknowledgment from the depository in which the depository acknowledges and agrees to requirements and conditions set forth below (‘‘Acknowledgment Letter’’).18 The Customer Property c. CFTC Required Acknowledgment Letter Each Acknowledgment Letter must be executed in the form specified in the Customer Property Segregation Rules with no additions, deletions or modifications permitted.20 In the Acknowledgement Letter, the depository is required to acknowledge and agree, among other things: (1) That the FCM/DCO has opened or will open the subject account for the purpose of depositing, Customer Property, as required by Customer Property Segregation Rules, including Regulation 1.20, as amended; (2) that the Customer Property held by the depository after being deposited into the subject account will be separately accounted for and segregated on the depository’s books from the FCM/DCO’s own funds and from any other funds or accounts held by the FCM/DCO in accordance with the Customer Property Segregation Rules; (3) that such Customer Property may not be used by the depository or by the FCM/DCO to secure or guarantee any obligations that the FCM/DCO might owe the depository, and they may not be used by FCM/DCO to secure or obtain credit from the depository; and (4) that the Customer Property in the subject account shall not be subject to any right of offset or lien for or on account of any indebtedness, obligations or liabilities the FCM/DCO has or may have owing to the depository. An FCM Acknowledgment Letter has additional examination, connectivity, and information requirements.21 13 See supra note 6. is proposing this rule change to provide Participants and Pledgees that may be FCMs or DCOs a mechanism to comply with their obligations under the Customer Property Segregation Rules. 15 ‘‘Futures Customer’’ means, with certain exceptions outlined in 17 CFR 1.3(iiii), any person who uses a futures commission merchant, introducing broker, commodity trading advisor, or commodity pool operator as an agent in connection with trading in any contract for the purchase of sale of a commodity for future delivery or any option on such contract. See 17 CFR 1.3(iiii). 16 See 17 CFR 1.20. 17 17 CFR 1.20(d); 1.20(g); 1.26; 22.5; 30.7. An FCM may also deposit customer property at a DCO or another FCM. 18 17 CFR 1.20, 1.26, 30.7. Although the Acknowledgment Letter requirement may relate to DTC, it is the sole obligation of the FCM or DCO. DTC is not subject to the Customer Property Segregation Rules, including without limitation, with respect to the Acknowledgement Letter. 14 DTC PO 00000 Frm 00062 Fmt 4703 Sfmt 4703 B. The Proposed Rule DTC would, pursuant to the proposed rule change, establish an Account type that a Participant or Pledgee could use to segregate its Customer Property and provide DTC with the representations needed in order for DTC to execute FCM and DCO Acknowledgment Letters for such Accounts, as may be requested. Because DTC does not have independent knowledge of whether a Participant or Pledgee is utilizing an 19 The Acknowledgment Letter requirements are set forth in 17 CFR l.20(d) and 1.26 (with respect to futures customer funds), 22.5 (with respect to cleared swaps customer collateral) and 30.7(d) (with respect to 30.7 customer funds-applicable to FCMs only). See Appendices A and B to 17 CFR 1.20; Appendix A to 17 CFR 1.26; Appendix E to 17 CFR 30. 20 17 CFR l.20(d)(2), 22.5(a) and 30.7(d)(2). 21 See Appendix A to 17 CFR 1.20. E:\FR\FM\06NON1.SGM 06NON1 Pmangrum on DSK3GDR082PROD with NOTICES 51446 Federal Register / Vol. 82, No. 213 / Monday, November 6, 2017 / Notices Account for the benefit of customers, in the absence of such representations, DTC would not be able to sign an Acknowledgement Letter. The proposed rule change would add Rule 37 to the Rules, to provide for: (1) The establishment and maintenance by a Participant or Pledgee that is a DCO or FCM (respectively, ‘‘DCO Party’’ and ‘‘FCM Party’’) of one or more segregated Accounts (respectively, a ‘‘Segregated DCO Account’’ or ‘‘Segregated FCM Account’’) for the purpose of holding interests in Customer Property; (2) credits to and debits from Segregated DCO Accounts and Segregated FCM Accounts in the manner otherwise provided by in the Rules and Procedures; (3) the representation of each DCO Party to DTC: i. That the only interests in property that such DCO Party shall cause or allow to be credited to its Segregated DCO Account (or Accounts) shall be interests in Deposited Securities that constitute Customer Property; ii. that interests in Customer Property credited to its Segregated DCO Account (or Accounts) shall not be used by such DCO Party to secure or otherwise guarantee any obligations that such DCO Party might owe to DTC; iii. that interests in Customer Property credited to its Segregated DCO Account (or Accounts) shall not be subject to any right of offset or lien for or on account of any indebtedness, obligations or liabilities that such DCO Party may have owing to DTC; and iv. that DTC shall be entitled to rely on the representations of such DCO Party in connection with any acknowledgment that DTC may be required to provide to such DCO Party and/or the CFTC pursuant to the Customer Property Segregation Rules or for any other purpose; (4) the representation of each FCM Party to DTC: i. That the only interests in property that such FCM Party shall cause or allow to be credited to its Segregated FCM Account (or Accounts) shall be interests in Deposited Securities that constitute Customer Property; ii. that interests in Customer Property credited to its Segregated FCM Account (or Accounts) shall not be used by such FCM Party to secure or otherwise guarantee any obligations that such FCM Party might owe to DTC; iii. that interests in Customer Property credited to its Segregated FCM Account (or Accounts) shall not be subject to any right of offset or lien for or on account of any indebtedness, obligations or VerDate Sep<11>2014 14:48 Nov 03, 2017 Jkt 244001 liabilities that such FCM Party may have owing to DTC; and iv. that DTC shall be entitled to rely on the representations of such FCM Party in connection with any acknowledgment that DTC may be required to provide to such FCM Party and/or the CFTC pursuant to the Customer Property Segregation Rules or for any other purpose; (5) the representation of DTC to each DCO Party that interests in Customer Property credited to the Segregated DCO Account (or Accounts) of such DCO Party: i. May not be used by DTC to secure or guarantee any obligations that such DCO Party might owe to DTC; ii. may not be used by such DCO Party to secure or obtain credit from DTC; and iii. shall not be subject to any right of offset or lien for or on account of any indebtedness, obligations or liabilities such DCO Party may have owing to DTC; provided, however, that this prohibition does not affect the right of DTC to recover funds advanced in the form of cash transfers, lines of credit, repurchase agreements or other liquidity arrangements DTC makes in lieu of liquidating non-cash assets held in the Segregated DCO Account (or Accounts) of such DCO Party or in lieu of converting cash held in the Segregated DCO Account (or Accounts) of such DCO Party to cash in a different currency; (6) the representation of DTC to each FCM Party that interests in Customer Property credited to the Segregated FCM Account (or Accounts) of such FCM Party: i. May not be used by DTC to secure or guarantee any obligations that such FCM Party might owe to DTC; ii. may not be used by such FCM Party to secure or obtain credit from DTC; and iii. shall not be subject to any right of offset or lien for or on account of any indebtedness, obligations or liabilities such FCM Party may have owing to DTC; provided, however, that this prohibition does not affect the right of DTC to recover funds advanced in the form of cash transfers, lines of credit, repurchase agreements or other liquidity arrangements DTC makes in lieu of liquidating non-cash assets held in the Segregated FCM Account (or Accounts) of such FCM Party or in lieu of converting cash held in the Segregated FCM Account (or Accounts) of such FCM Party to cash in a different currency; (7) DTC’s disclaimer of liability: i. To any DCO Party or FCM Party as a result of DTC acting on an instruction from such DCO Party or FCM Party to PO 00000 Frm 00063 Fmt 4703 Sfmt 4703 credit to or debit from interests in Customer Property from a Segregated DCO Account or Segregated FCM Account, respectively; ii. to any DCO Party or FCM Party as a result of (x) any loss or liability suffered or incurred by such DCO Party or FCM Party arising out of or relating to the matters subject to proposed Rule 37, unless caused directly by the gross negligence or willful misconduct of DTC or by a violation of Federal securities law by DTC for which there is a private right of action, or (y) any force majeure, market disruption or technical malfunction that prevents DTC from performing its obligations to such DCO Party or FCM Party pursuant to proposed Rule 37; and iii. to any third party (including without limitation any customer of any DCO Party or FCM Party) for any reason; and a provision stating that in the event of a conflict between proposed Rule 37 and the provisions of any other Rule, the provisions of Proposed Rule 37 would govern. Implementation Timeframe The proposed rule change would be implemented 30 days after the date of filing, or such shorter time as the Commission may designate. 2. Statutory Basis DTC believes that the proposed rule change is consistent with the requirements of the Act, and the rules and regulations thereunder applicable to DTC, in particular section 17A(b)(3)(F) of the Act 22 and Rule 17Ad–22(e)(21) thereunder.23 Section 17A(b)(3)(F) of the Act requires, inter alia, that the rules of the clearing agency be designed to promote the prompt and accurate clearance and settlement of securities transactions.24 The proposed rule change provides a basis on which DTC may provide Acknowledgement Letters, affording the efficiency of DTC book-entry transfers for securities transactions relating to Customer Property. By establishing special segregated Accounts for Participants and Pledgees to use for Customer Property held at DTC, where they otherwise would have the administrative burden of segregating Customer Property at another depository in compliance with the Customer Property Segregation Rules, proposed Rule 37 is designed to promote the prompt and accurate clearance and settlement of securities transactions, consistent with the requirements of the 22 15 U.S.C. 78q–1(b)(3)(F). CFR 240.17Ad–22(e)(21). 24 15 U.S.C. 78q–1(b)(3)(F). 23 17 E:\FR\FM\06NON1.SGM 06NON1 Federal Register / Vol. 82, No. 213 / Monday, November 6, 2017 / Notices Act, in particular section 17A(b)(3)(F), cited above. Rule 17Ad–22(e)(21) requires, inter alia, that each covered clearing agency establish, implement, maintain and enforce written policies and procedures reasonably designed to be efficient and effective in meeting the requirements of its participants and the markets it serves.25 Pursuant to the proposed rule change, the Rules would be updated to establish a framework for DTC to provide Acknowledgement Letters to Participants and Pledgees who are DCOs or FCMs that would allow them to meet their requirements under the Customer Property Segregation Rules, while utilizing the efficiency provided by DTC book-entry transfers, consistent with the requirements of Rule 17Ad–22(e)(21), cited above. (B) Clearing Agency’s Statement on Burden on Competition DTC does not believe that the proposed rule change would have any impact, or impose any burden, on competition because the proposed Rule and its features would be available to all Participants and Pledgees equally on a non-discriminatory basis. Participants and Pledgees will be charged fees applicable to the maintenance of Accounts and transaction fees that are not different from established published fees. (C) Clearing Agency’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others DTC has not solicited and does not intend to solicit comments regarding the proposed rule change. DTC has not received any unsolicited written comments from interested parties. To the extent DTC receives written comments on the proposed rule change, DTC will forward such comments to the Commission. Pmangrum on DSK3GDR082PROD with NOTICES III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to section 19(b)(3)(A) of the Act 26 and Rule 19b–4(f)(6) thereunder.27 At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. will be posted without change. Persons submitting comments are cautioned that we do not redact or edit personal identifying information from comment submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–DTC–2017–020 and should be submitted on or before November 27, 2017. IV. Solicitation of Comments Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.28 Eduardo A. Aleman, Assistant Secretary. Electronic Comments • Use the Commission’s Internet comment form (https://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– DTC–2017–020 on the subject line. SECURITIES AND EXCHANGE COMMISSION Paper Comments • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–DTC–2017–020. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s Internet Web site (https://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission’s Public Reference Room, 100 F Street NE., Washington, DC 20549–1090 on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of DTC and on DTCC’s Web site (https://dtcc.com/legal/sec-rulefilings.aspx). All comments received CFR 240.17Ad–22(e)(21). VerDate Sep<11>2014 14:48 Nov 03, 2017 27 17 Jkt 244001 [FR Doc. 2017–24049 Filed 11–3–17; 8:45 am] BILLING CODE 8011–01–P [Release No. 34–81985; File No. SR– NYSEArca–2017–127] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Regarding Exchange Calculation of the Intraday Indicative Value for Specified Exchange-Traded Products October 31, 2017. Pursuant to section 19(b)(1) 1 of the Securities Exchange Act of 1934 (‘‘Act’’) 2 and Rule 19b–4 thereunder,3 notice is hereby given that, on October 20, 2017, NYSE Arca, Inc. (‘‘Exchange’’ or ‘‘NYSE Arca’’) filed with the Securities and Exchange Commission the proposed rule change as described in Items I and II below, which Items have been prepared by the selfregulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to modify representations made in proposed rule changes previously filed with the Securities and Exchange Commission (‘‘Commission’’) regarding Exchange calculation of the ‘‘Intraday Indicative Value’’ (or comparable intra-day value) for specified exchange-traded products. The proposed rule change is available on the Exchange’s Web site at www.nyse.com, at the principal office of 28 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 15 U.S.C. 78a. 3 17 CFR 240.19b–4. 1 15 26 15 25 17 51447 PO 00000 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). Frm 00064 Fmt 4703 Sfmt 4703 E:\FR\FM\06NON1.SGM 06NON1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 82, Number 213 (Monday, November 6, 2017)]
[Notices]
[Pages 51444-51447]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-24049]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-81990; File No. SR-DTC-2017-020]

Self-Regulatory Organizations; The Depository Trust Company;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Establish a Special Segregation Account for a Participant or Pledgee
That Is a Derivatives Clearing Organization or Futures Commission
Merchant

October 31, 2017.
Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on October 20, 2017, The Depository Trust Company (``DTC'') filed with
the Securities and Exchange Commission (``Commission'') the proposed
rule change as described in Items I, II and III below, which Items have
been prepared by DTC. DTC filed the proposed rule change pursuant to
section 19(b)(3)(A) of the Act \3\ and Rule 19b-4(f)(6) thereunder.\4\
The Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A).
\4\ 17 CFR 240.19b-4(f)(6).
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I. Clearing Agency's Statement of the Terms of Substance of the
Proposed Rule Change

The proposal would add new Rule 37 (Segregated Accounts for
Customer Property) to provide that a Participant \5\ or Pledgee may
establish a specifically designated Account to which Eligible
Securities may be credited that the Participant or Pledgee wishes to
segregate as the property of its customers that trade commodities,
options, swaps, and other products (``Customer Property'') subject to
the Customer Property Segregation Rules.\6\ Based on this segregation
structure and the representations and warranties made by the
Participant or Pledgee under the proposed Rule, DTC would, upon the
request of the Participant or Pledgee, provide an acknowledgment of the
segregation of such Customer Property,\7\ as further described below.
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\5\ Each capitalized term not otherwise defined herein has its
respective meaning as set forth in the Rules, By-Laws and
Organization Certificate of The Depository Trust Company (the
``Rules''), available at https://www.dtcc.com/legal/rules-and-procedures.aspx.
\6\ ``Customer Property Segregation Rules'' means the rules and
regulations of the Commodity Futures Trading Commission (``CFTC''),
relating to the deposit of customer property (including money,
securities and other property) held by derivatives clearing
organizations (``DCOs'') or futures commission merchants (``FCMs'')
for customers that trade commodities, options, swaps and other
products. 7 U.S.C. 6d; 17 CFR 1.20-1.30, 22, 30. Under the proposed
rule change, only Deposited Securities credited to an appropriately
designated Account may constitute ``Customer Property'' for purposes
of such Customer Property Segregation Rules; DTC does not, and will
not under the proposed rule change, segregate money.
\7\ See 7 U.S.C. 6d(a)(2); 7 U.S.C. 6d(f); 17 CFR 1.20(d);
1.20(g); 1.26; 22.5; 30.7.
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II. Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change

In its filing with the Commission, DTC included statements
concerning the purpose of, and basis for, the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. DTC has prepared summaries, set forth in sections A, B,
and C below, of the most significant aspects of such statements.

(A) Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change

1. Purpose
The proposal would add new Rule 37 (Segregated Accounts for
Customer Property) to provide that a Participant or Pledgee may
establish a specifically designated Account to which Eligible
Securities may be credited that the Participant or Pledgee wishes to
segregate as Customer Property subject to the Customer Property
Segregation Rules. Based on this segregation structure and the
representations and warranties made by the Participant or Pledgee under
the proposed Rule, DTC would, upon the request of the Participant or
Pledgee, provide an acknowledgment of the segregation of such Customer
Property, as further described below.
A. Background
a. DTC Omnibus Account Structure
DTC maintains omnibus Accounts for its Participants and
Pledgees.\8\ That is, it

[[Page 51445]]

does not distinguish among Accounts that Participants or Pledgees may
use for activities that are proprietary or conducted by the Participant
or Pledgee for the benefit of customer(s). The Rules expressly provide
that ``[a] Participant or Pledgee which utilizes the services of [DTC]
for another Person shall, so far as the rights of [DTC], and other
Participants and Pledgees are concerned, be liable as principal.'' \9\
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\8\ DTC holds Eligible Securities collectively on behalf of
Participants and reflects the transfer of interests in those
Eligible Securities among Participants by computerized book-entry.
Eligible Securities Deposited with DTC for book-entry transfer
services are registered in the name of its nominee, Cede & Co.
(``Cede''), a New York partnership. When the Eligible Securities are
registered in the name of Cede, DTC acquires legal title to the
Eligible Securities and, when DTC credits interests in these
Eligible Securities to the Securities Accounts of Participants,
those Participants acquire a beneficial interest in the Eligible
Securities and a Security Entitlement with respect to those Eligible
Securities is credited to their Accounts. A Security Entitlement is
both a package of personal rights against the securities
intermediary [in this case, DTC] and an interest in the property
held by the securities intermediary. NYUCC Sec. 8-102(14)(i); NYUCC
Sec. 8-102(17) and OFF. CMT. 17. A security entitlement is not,
however, a specific property interest in any [security] held by the
securities intermediary or by the clearing corporation through which
the securities intermediary holds the [security]. NYUCC Sec. 8-
102(17) and OFF. CMT. 17. Thus, a Participant does not have a right
to any particular security; each Participant has a proportionate
interest in the fungible total inventory of the issue held by DTC.
Participants, in many cases, are themselves securities
intermediaries, maintaining securities accounts for the benefit of
their customers, crediting a portion of the amount of any issue of a
Security held in their Account(s) to one or more customers, as
securities entitlements of their customers against them. That is,
their customers are entitlement holders, holding the rights and
property interest represented by the amount of the security credited
to their account(s) vis a vis the Participant. Some customers of a
Participant may also be securities intermediaries, holding on behalf
of, and maintaining securities accounts for, their own customers,
and so forth. DTC does not know whether a Participant is holding
interest in the Securities for itself or on behalf of its customers,
as their securities intermediary.
This tiered system of intermediaries holding interests in
securities for their respective customers is generally described as
the ``indirect holding system.'' Id. Any entitlement holder may only
assert its rights to a security entitlement against its own
securities intermediary; Participants and Pledgees are in
contractual privity with DTC; their customers are not and do not
have any claim against DTC to the security entitlement of the
Participant. Such customers of a Participant would have securities
entitlements against the Participant that is acting on their behalf
as their ``securities intermediary.'' Such customers only have
rights against the Participant, and not against the Participant's
securities intermediary; i.e., DTC. See NYUCC Sec. 8-503 OFF. CMT.
2. (``The entitlement holder cannot assert rights directly against
other persons, such as other intermediaries [DTC] through whom the
intermediary [the Participants] holds the positions . . . .'').
Moreover, DTC does not owe any duties to such customers. See NYUCC
Sec. 8-115 OFF. CMT. 4. (``[T]his section embodies one of the
fundamental principles of the Article 8 indirect holding system
rules--that a securities intermediary [DTC] owes duties only to its
own entitlement holders [its Participants]'').
\9\ Rule 2, section 2, supra note 5.
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The Rules provide for Segregated Accounts that Participants have
typically used to separate Securities held for their customers. The
characteristics of a Segregated Account are, chiefly, that DTC has no
lien on or claim to the Securities credited thereto to secure any
obligation of the Participant to DTC.\10\ Participants therefore use
Segregated Accounts to separately identify customer property.\11\
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\10\ Rule 1, section 1, supra note 5.
\11\ Participants that are registered broker-dealers use
Segregation Accounts as a tool to maintain compliance with their
obligations under Rule 15c3-3 of the Act (``Customer Protection
Rule''). 17 CFR 240.15c3-3. The Customer Protection Rule requires,
among other things, that broker-dealers maintain control of all
fully-paid or excess margin Securities they hold for the accounts of
customers. Compliance with those obligations by such broker-dealers
is external to DTC. See Rule 2, supra note 5.
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The Rules also provide that Securities Pledged to a Pledgee (when
credited to the Account of the Pledgee in a Free Pledge or, in a Pledge
Versus Payment), are held free of any lien or other interest of
DTC.\12\ Thus, the Pledge mechanism is a tool that may be used by a
Pledgee to segregate Securities at DTC.
---------------------------------------------------------------------------

\12\ Rule 4(A), supra note 5.
---------------------------------------------------------------------------

If a Participant or Pledgee holds Segregated or Pledged Securities
on behalf of customers, that would be reflected in the accounts
maintained by the Participant or Pledgee for its customers. DTC has no
knowledge of whether Securities credited in that manner are held by the
Participant or Pledgee for customers. It is the sole responsibility of
the Participant or Pledgee to maintain appropriate records on its own
books to identify customer Securities separately.
b. Customer Property Segregation Rules of the CFTC
Because DTC is agnostic as to whether, when and how any Participant
or Pledgee may be utilizing its Account for the benefit of customers,
DTC cannot independently verify that any particular Securities are
``customer securities'' vis-[agrave]-vis the Participant or Pledgee.
However, FCMs and DCOs have statutory requirements for the separate
identification of Customer Property pursuant to the Customer Property
Segregation Rules.\13\ To accommodate this need of certain Participants
or Pledgees that are FCMs or DCOs, DTC proposes this rule change,
pursuant to which DTC would provide acknowledgment of Customer Property
credited to the specified Accounts, in reliance on the representations
of the Participant or Pledgee provided in the proposed Rule.\14\
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\13\ See supra note 6.
\14\ DTC is proposing this rule change to provide Participants
and Pledgees that may be FCMs or DCOs a mechanism to comply with
their obligations under the Customer Property Segregation Rules.
---------------------------------------------------------------------------

The Customer Property Segregation Rules require that each FCM and
DCO separately account for, and segregate from its own proprietary
funds, all money, securities, or other property deposited by futures
customers \15\ for trading on designated contract markets.\16\ The
Customer Property Segregation Rules also provide that an FCM or DCO may
only deposit futures customer property with a bank or trust company,
and, additionally, an FCM may deposit with a DCO or another FCM (each,
a ``depository'').\17\ FCMs and DCOs are required to obtain a written
acknowledgment from the depository in which the depository acknowledges
and agrees to requirements and conditions set forth below
(``Acknowledgment Letter'').\18\ The Customer Property Segregation
Rules prescribe the precise form of Acknowledgment Letter that is
required for each the entity type (FCM and DCO) and the type of
Customer Property.\19\
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\15\ ``Futures Customer'' means, with certain exceptions
outlined in 17 CFR 1.3(iiii), any person who uses a futures
commission merchant, introducing broker, commodity trading advisor,
or commodity pool operator as an agent in connection with trading in
any contract for the purchase of sale of a commodity for future
delivery or any option on such contract. See 17 CFR 1.3(iiii).
\16\ See 17 CFR 1.20.
\17\ 17 CFR 1.20(d); 1.20(g); 1.26; 22.5; 30.7. An FCM may also
deposit customer property at a DCO or another FCM.
\18\ 17 CFR 1.20, 1.26, 30.7. Although the Acknowledgment Letter
requirement may relate to DTC, it is the sole obligation of the FCM
or DCO. DTC is not subject to the Customer Property Segregation
Rules, including without limitation, with respect to the
Acknowledgement Letter.
\19\ The Acknowledgment Letter requirements are set forth in 17
CFR l.20(d) and 1.26 (with respect to futures customer funds), 22.5
(with respect to cleared swaps customer collateral) and 30.7(d)
(with respect to 30.7 customer funds-applicable to FCMs only). See
Appendices A and B to 17 CFR 1.20; Appendix A to 17 CFR 1.26;
Appendix E to 17 CFR 30.
---------------------------------------------------------------------------

c. CFTC Required Acknowledgment Letter
Each Acknowledgment Letter must be executed in the form specified
in the Customer Property Segregation Rules with no additions, deletions
or modifications permitted.\20\ In the Acknowledgement Letter, the
depository is required to acknowledge and agree, among other things:
---------------------------------------------------------------------------

\20\ 17 CFR l.20(d)(2), 22.5(a) and 30.7(d)(2).
---------------------------------------------------------------------------

(1) That the FCM/DCO has opened or will open the subject account
for the purpose of depositing, Customer Property, as required by
Customer Property Segregation Rules, including Regulation 1.20, as
amended;
(2) that the Customer Property held by the depository after being
deposited into the subject account will be separately accounted for and
segregated on the depository's books from the FCM/DCO's own funds and
from any other funds or accounts held by the FCM/DCO in accordance with
the Customer Property Segregation Rules;
(3) that such Customer Property may not be used by the depository
or by the FCM/DCO to secure or guarantee any obligations that the FCM/
DCO might owe the depository, and they may not be used by FCM/DCO to
secure or obtain credit from the depository; and
(4) that the Customer Property in the subject account shall not be
subject to any right of offset or lien for or on account of any
indebtedness, obligations or liabilities the FCM/DCO has or may have
owing to the depository.
An FCM Acknowledgment Letter has additional examination,
connectivity, and information requirements.\21\
---------------------------------------------------------------------------

\21\ See Appendix A to 17 CFR 1.20.
---------------------------------------------------------------------------

B. The Proposed Rule
DTC would, pursuant to the proposed rule change, establish an
Account type that a Participant or Pledgee could use to segregate its
Customer Property and provide DTC with the representations needed in
order for DTC to execute FCM and DCO Acknowledgment Letters for such
Accounts, as may be requested. Because DTC does not have independent
knowledge of whether a Participant or Pledgee is utilizing an

[[Page 51446]]

Account for the benefit of customers, in the absence of such
representations, DTC would not be able to sign an Acknowledgement
Letter.
The proposed rule change would add Rule 37 to the Rules, to provide
for:
(1) The establishment and maintenance by a Participant or Pledgee
that is a DCO or FCM (respectively, ``DCO Party'' and ``FCM Party'') of
one or more segregated Accounts (respectively, a ``Segregated DCO
Account'' or ``Segregated FCM Account'') for the purpose of holding
interests in Customer Property;
(2) credits to and debits from Segregated DCO Accounts and
Segregated FCM Accounts in the manner otherwise provided by in the
Rules and Procedures;
(3) the representation of each DCO Party to DTC:
i. That the only interests in property that such DCO Party shall
cause or allow to be credited to its Segregated DCO Account (or
Accounts) shall be interests in Deposited Securities that constitute
Customer Property;
ii. that interests in Customer Property credited to its Segregated
DCO Account (or Accounts) shall not be used by such DCO Party to secure
or otherwise guarantee any obligations that such DCO Party might owe to
DTC;
iii. that interests in Customer Property credited to its Segregated
DCO Account (or Accounts) shall not be subject to any right of offset
or lien for or on account of any indebtedness, obligations or
liabilities that such DCO Party may have owing to DTC; and
iv. that DTC shall be entitled to rely on the representations of
such DCO Party in connection with any acknowledgment that DTC may be
required to provide to such DCO Party and/or the CFTC pursuant to the
Customer Property Segregation Rules or for any other purpose;
(4) the representation of each FCM Party to DTC:
i. That the only interests in property that such FCM Party shall
cause or allow to be credited to its Segregated FCM Account (or
Accounts) shall be interests in Deposited Securities that constitute
Customer Property;
ii. that interests in Customer Property credited to its Segregated
FCM Account (or Accounts) shall not be used by such FCM Party to secure
or otherwise guarantee any obligations that such FCM Party might owe to
DTC;
iii. that interests in Customer Property credited to its Segregated
FCM Account (or Accounts) shall not be subject to any right of offset
or lien for or on account of any indebtedness, obligations or
liabilities that such FCM Party may have owing to DTC; and
iv. that DTC shall be entitled to rely on the representations of
such FCM Party in connection with any acknowledgment that DTC may be
required to provide to such FCM Party and/or the CFTC pursuant to the
Customer Property Segregation Rules or for any other purpose;
(5) the representation of DTC to each DCO Party that interests in
Customer Property credited to the Segregated DCO Account (or Accounts)
of such DCO Party:
i. May not be used by DTC to secure or guarantee any obligations
that such DCO Party might owe to DTC;
ii. may not be used by such DCO Party to secure or obtain credit
from DTC; and
iii. shall not be subject to any right of offset or lien for or on
account of any indebtedness, obligations or liabilities such DCO Party
may have owing to DTC; provided, however, that this prohibition does
not affect the right of DTC to recover funds advanced in the form of
cash transfers, lines of credit, repurchase agreements or other
liquidity arrangements DTC makes in lieu of liquidating non-cash assets
held in the Segregated DCO Account (or Accounts) of such DCO Party or
in lieu of converting cash held in the Segregated DCO Account (or
Accounts) of such DCO Party to cash in a different currency;
(6) the representation of DTC to each FCM Party that interests in
Customer Property credited to the Segregated FCM Account (or Accounts)
of such FCM Party:
i. May not be used by DTC to secure or guarantee any obligations
that such FCM Party might owe to DTC;
ii. may not be used by such FCM Party to secure or obtain credit
from DTC; and
iii. shall not be subject to any right of offset or lien for or on
account of any indebtedness, obligations or liabilities such FCM Party
may have owing to DTC; provided, however, that this prohibition does
not affect the right of DTC to recover funds advanced in the form of
cash transfers, lines of credit, repurchase agreements or other
liquidity arrangements DTC makes in lieu of liquidating non-cash assets
held in the Segregated FCM Account (or Accounts) of such FCM Party or
in lieu of converting cash held in the Segregated FCM Account (or
Accounts) of such FCM Party to cash in a different currency;
(7) DTC's disclaimer of liability:
i. To any DCO Party or FCM Party as a result of DTC acting on an
instruction from such DCO Party or FCM Party to credit to or debit from
interests in Customer Property from a Segregated DCO Account or
Segregated FCM Account, respectively;
ii. to any DCO Party or FCM Party as a result of (x) any loss or
liability suffered or incurred by such DCO Party or FCM Party arising
out of or relating to the matters subject to proposed Rule 37, unless
caused directly by the gross negligence or willful misconduct of DTC or
by a violation of Federal securities law by DTC for which there is a
private right of action, or (y) any force majeure, market disruption or
technical malfunction that prevents DTC from performing its obligations
to such DCO Party or FCM Party pursuant to proposed Rule 37; and
iii. to any third party (including without limitation any customer
of any DCO Party or FCM Party) for any reason; and a provision stating
that in the event of a conflict between proposed Rule 37 and the
provisions of any other Rule, the provisions of Proposed Rule 37 would
govern.
Implementation Timeframe
The proposed rule change would be implemented 30 days after the
date of filing, or such shorter time as the Commission may designate.
2. Statutory Basis
DTC believes that the proposed rule change is consistent with the
requirements of the Act, and the rules and regulations thereunder
applicable to DTC, in particular section 17A(b)(3)(F) of the Act \22\
and Rule 17Ad-22(e)(21) thereunder.\23\
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\22\ 15 U.S.C. 78q-1(b)(3)(F).
\23\ 17 CFR 240.17Ad-22(e)(21).
---------------------------------------------------------------------------

Section 17A(b)(3)(F) of the Act requires, inter alia, that the
rules of the clearing agency be designed to promote the prompt and
accurate clearance and settlement of securities transactions.\24\ The
proposed rule change provides a basis on which DTC may provide
Acknowledgement Letters, affording the efficiency of DTC book-entry
transfers for securities transactions relating to Customer Property. By
establishing special segregated Accounts for Participants and Pledgees
to use for Customer Property held at DTC, where they otherwise would
have the administrative burden of segregating Customer Property at
another depository in compliance with the Customer Property Segregation
Rules, proposed Rule 37 is designed to promote the prompt and accurate
clearance and settlement of securities transactions, consistent with
the requirements of the

[[Page 51447]]

Act, in particular section 17A(b)(3)(F), cited above.
---------------------------------------------------------------------------

\24\ 15 U.S.C. 78q-1(b)(3)(F).
---------------------------------------------------------------------------

Rule 17Ad-22(e)(21) requires, inter alia, that each covered
clearing agency establish, implement, maintain and enforce written
policies and procedures reasonably designed to be efficient and
effective in meeting the requirements of its participants and the
markets it serves.\25\ Pursuant to the proposed rule change, the Rules
would be updated to establish a framework for DTC to provide
Acknowledgement Letters to Participants and Pledgees who are DCOs or
FCMs that would allow them to meet their requirements under the
Customer Property Segregation Rules, while utilizing the efficiency
provided by DTC book-entry transfers, consistent with the requirements
of Rule 17Ad-22(e)(21), cited above.
---------------------------------------------------------------------------

\25\ 17 CFR 240.17Ad-22(e)(21).
---------------------------------------------------------------------------

(B) Clearing Agency's Statement on Burden on Competition

DTC does not believe that the proposed rule change would have any
impact, or impose any burden, on competition because the proposed Rule
and its features would be available to all Participants and Pledgees
equally on a non-discriminatory basis. Participants and Pledgees will
be charged fees applicable to the maintenance of Accounts and
transaction fees that are not different from established published
fees.

DTC has not solicited and does not intend to solicit comments
regarding the proposed rule change. DTC has not received any
unsolicited written comments from interested parties. To the extent DTC
receives written comments on the proposed rule change, DTC will forward
such comments to the Commission.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

Because the foregoing proposed rule change does not:
(i) Significantly affect the protection of investors or the public
interest;
(ii) impose any significant burden on competition; and
(iii) become operative for 30 days from the date on which it was
filed, or such shorter time as the Commission may designate, it has
become effective pursuant to section 19(b)(3)(A) of the Act \26\ and
Rule 19b-4(f)(6) thereunder.\27\
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\26\ 15 U.S.C. 78s(b)(3)(A).
\27\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.

IV. Solicitation of Comments

Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-DTC-2017-020 on the subject line.

Paper Comments

Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-DTC-2017-020. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549-1090 on official business days between the hours
of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of DTC and on DTCC's
Web site (https://dtcc.com/legal/sec-rule-filings.aspx). All comments
received will be posted without change. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly.
All submissions should refer to File Number SR-DTC-2017-020 and
should be submitted on or before November 27, 2017.

For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\28\
---------------------------------------------------------------------------

\28\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-24049 Filed 11-3-17; 8:45 am]
BILLING CODE 8011-01-P

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